The sinking of SCI Ratna, an oil exploration support vessel owned by state-run Shipping Corporation of India Ltd (SCI), 96 nautical miles off the coast of Mumbai on Tuesday, comes as a huge embarrassment to the government, the fleet-owner and the shipyard that built the vessel.

The sinking of the six-year-old ship is also bad publicity for Indian yards on the global stage, particularly at a time when the government seeks to promote local shipbuilders, including through financial assistance, to compete with overseas rivals.

“All the 16 shipboard personnel who were on board the vessel have been rescued and are safe,” SCI said in a filing to the BSE on Wednesday. “The probable reason of sinking of vessel is ingress of water in the engine room. The actual cause is yet to be ascertained and is being investigated,” it added.

SCI Ratna was under a contract with the Oil and Natural Gas Corporation Ltd (ONGC) to support its oil exploration operations at the Bombay High. The mishap adds to the woes of the Navratna company which has run up a first half net loss of ₹82.90 crore in FY18.

SCI’S FOUR VESSELS

In October 2007, SCI ordered four anchor handling, towing and supply vessels (AHTSVs), each with a pulling power of 80 tonnes, from Bharati Shipyard Ltd. AHTSVs are typically used to carry water, cement, food and chemicals to oil drilling rigs, and help in anchor handling facilities to position the rig appropriately. They play a key supporting role in offshore oil exploration.

The price of each vessel was $22.32 million and the total cost of purchase was $89.28 million or around ₹351 crore at the exchange rates prevailing then.

The vessels were built on the Havyard design, used for the first time for such vessels built in India. The design allows higher deadweight tonnage and higher cargo carrying capacity compared to other 80-tonne vessels with similar dimensions.

SCI took delivery of three of the four ships it ordered — SCI Ratna, SCI Panna, SCI Mukta — even after the yard slipped on construction schedules.

The Mumbai-based company, though, cancelled the fourth ship named SCI Heera due to construction delays. Bharati is saddled with this vessel even today.

SCI officials briefed on the four-ship order said the tender for buying the vessels was restricted to local yards while overseas yards were excluded.

QUALITY ISSUES

“The ships had quality issues and were not up to the standards of Japanese or South Korean built-vessels,” said an official who was part of the tendering process.

SCI Ratna, which is under the technical and offshore service unit of SCI, is under the watch of Capt Anoop Kumar Sharma, the Chairman and Managing Director, who holds additional charge of the division since March.

OFFSHORE SERVICE UNIT

The government’s head hunter, the Public Enterprises Selection Board (PESB), has recommended the name of Rajesh Sood as director for the technical and offshore services unit. The recommendation of Sood, a senior Vice-President at SCI, is yet to be ratified by the Shipping Ministry.

FINANCIAL TROUBLES

Bharati Shipyard has since fallen into bad days with mounting financial troubles.

Once India’s second biggest private shipyard, it now faces bankruptcy proceedings under the Insolvency and Bankruptcy Code at the National Company Law Tribunal (NCLT).

Earlier this year, creditors, led by Edelweiss ARC, which owns 85 per cent of the ₹10,000-crore debt of the company, filed a case at NCLT seeking permission to turn around the company under a new management.
SCI runs a fleet of 70 ships, including 11 offshore supply vessels.

Source: Hellenic Shipping News.